But the clock is ticking, it claimed.
“By removing distractions and streamlining expenses, Riot is now positioned to focus on executing its AI/HPC strategy,” Starboard Value Managing Member Peter Feld wrote. “But to get the full benefit of this strategic transformation, Riot must complete its governance and operational transformation.”
“Riot’s share price has materially underperformed peers who have signed sizable AI/HPC deals,” Feld wrote. “Although this underperformance is frustrating, we believe that Riot is better positioned to do higher-quality deals than its peers. Time is of the essence, and a renewed sense of urgency is required to get more material deals completed.”
Starboard believes that the opportunity for Riot, because of the attractive nature of its sites, could amount to as much as a $21 billion valuation bump—about four times the size of the firm’s current market cap.
“We believe the equity value contribution from AI/HPC data centers at Corsicana and Rockdale could be $9 to $21 billion, dwarfing Riot’s current market cap,” Feld said, based on estimates from his firm. “Taking into account Riot’s net cash balance, this would imply that Riot is worth between $23 and $53 per share.”
Shares in the firm finished the day up nearly 6% on Wednesday, changing hands at $15.49. That represents a jump of more than 25% in the last six months, but a leap to $53 would see another 242% gain for shareholders.
Decrypt reached out to Riot Platforms for comment on the Starboard letter, but did not immediately receive a response.
